Summary

In response to a congressional request, GAO reviewed the Food and Nutrition Service's (FNS) management of the Food Stamp Program to determine the effects of raising or lowering the legislated target error-rate threshold that FNS uses to determine whether it should sanction a state for benefit overpayments.

GAO found that: (1) FNS sanctioned 44 states in 1986 under the 5-percent error-rate threshold; (2) if FNS had applied a 2-percent threshold, it would have sanctioned 53 states (the 50 states plus the District of Columbia, the U.S. Virgin Islands, and Guam); (3) if FNS had applied an 11-percent threshold, it would have sanctioned 4 states; and (4) if FNS had applied 1986 sanctions to combined error rates, it would have sanctioned 53 states at the 2-percent level and 17 at the 11-percent level. In addition, GAO found that: (1) in 1986, food stamp benefits totalled about $10.6 billion, with the FNS share of state administrative costs totalling about $947 million; and (2) the estimated state overpayment of food stamp benefits in 1986 totalled about $850 million, resulting in sanctions of $217 million.